Last month, Apple Chief Operating Officer Tim Cook said his company still views the Apple TV as a "hobby," and noted that sales of the product simply don't compare to the consumer markets for smartphones, computers and MP3 players. Cook said he doesn't believe the Apple TV will remain dormant, but it may take time for the potential market for the device to grow.

Here's what I think might be going on with the whole AppleTV + iTunes digital video distribution scene.

1 - The studios have been reluctant to provide Apple with full access to their TV and Movie catalogs for many reasons including but not limited to Apples domination of digital music content and their desire to see HD optical media to give them one last money grab before moving to all out digital distribution.

2 - Apple builds the AppleTV with no intention of supporting any optical media no SD DVD and certainly no HD be it HD-DVD or BluRay.

Fast forward...

- BluRay won the HD wars with somewhat muted response from the world. It certainly wasn't the same as it was when DVD's beat out DIVX... That seems to be a much bigger deal.

- Apple held firm and never picked sides (not really anyway) on the HD optical media showdown. And even when BluRay was crowned king Apple chose to not support the format.

- The Studios (those on the loosing side especially) meanwhile are still somewhat recovering from the HD wars and have lost some real money in the process.

Now... BluRay is king and what is the studios to do?

- Provide Apple full access to all of their titles in SD and HD and possibly kill or lessen the success of BluRay?

- Continue to drag their feet and roadblock Apple until such a time when EVERYONE is screaming for them to give it up and get serious about digital distribution.

- Back in Apples court do they DARE release a BluRay player for its computers that would, even in an admittedly small way prop up BluRay movie sales?

And here is where we are today... stuck in a rut... I don't like it any more than you do... \

I have to admit though I am always amazed at the Apple somewhat cult following by some.

If, as you claimed, you bought at $9.32, you should be thrilled that they have a 'cult following'.

I have to to admit I am amazed at your concern about the iPad, as reflected in your posts overall. It sounds like you don't really want it to go through the roof (or at the least, have some mixed feelings about its success) which seems totally at odds with what your goal/hope should be as a shareholder.

I would agree. I believe the iPad is going to do okay maybe even well but unlike my buddy Quadra I have serious doubts that "Slate" computing is going to take over notebooks anytime soon.

I have to admit though I am always amazed at the Apple somewhat cult following by some. If these numbers are correct its hard to understand people that will spend 600+ dollars a new product they have never even tried or have no clue if its going to have first generation issues.

However if it makes them happy go for it. Just hope they aren't flipping out if the price drops 200.00 in six months like the iPhone did.

The iPad isn't a notebook killer. It will kill netbooks, however.

All these Apple cultists, yet you seem to be a devout follower, trolling in just about every thread...

The price of the iPhone dropped because it was subsidized by AT&T.
Yeah, I'm sure the base iPad will soon be the same price as the 32GB iPod Touch. Apple will make that announcement the same day they lower the price of the Mac Pro to match that of the iMac.

If, as you claimed, you bought at $9.32, you should be thrilled that they have a 'cult following'.

I have to to admit I am amazed at your concern about the iPad, as reflected in your posts overall. It sounds like you don't really want it to go through the roof (or at the least, have some mixed feelings about its success) which seems totally at odds with what your goal/hope should be as an shareholder.

Ditto, I may be a fanboy. But I'm also a stockholder that could stand to profit from APPL in the future.

For anyone who thought the icon is some sort of digital book, it's not. It's demonstrating adding websites to the homepage...

obviously.

However, using National Geographic to demonstrate this feature might not be mere coincidence. Apple used National Geographic during the Safari demonstration as well. Either Apple's simply a fan of the National Geographic or they're in talks of bringing something from the magazine to iPad.

Either way, I think it's fairly clear that the icon is not an ebook application.

Are you sure those are not your own bank's charges for using the debit card, I can go back years looking at my Amex account and no such one dollar charges from Apple have ever occurred, in stock items or pre orders.

It probably is their bank. They are hitting them for using the debit card, and then Visa or whomever gets to take their 3% from Apple. The banks who do this make a killing. Luckily my bank doesn't do this. M&T used to, so if I were going to get gas or whatever, I'd always select credit. M&T didn't do it to credit cards, only if you used debit and entered your pin. When I found this out, bye-bye M&T. Too many charges for everything.

Well I don't believe that sales always reflect in the market. The stock market is based on perception rarely reality. The tech sector can be even more volatile. Lets remember Apple did really nothing wrong and had strong sales and their stock went as low as 78.00 a share in the last 52 week. So clearly that was based on market trend and not Apple.

1) We've had this discussion with you, and I am not going to get drawn into it again. I'll simply say that you do need to learn some basic finance before you talk about stuff like this. I am not saying it's necessary, but it might help.

2) You also perhaps want to reflect on the phrase, "all else equal." (As in, all else equal, as a shareholder who is presumably happier with a higher rather than lower stock price, would you prefer a more successful or less successful new product introduction by a company whose stock you own?)

Its not even something that competes with Netbooks because it doesn't run a desktop OS. Also people that buy netbooks are spending under 300.00 they would have to spend double to get even the lowest end iPad. So I dont see this killing netbooks.

In fact there has never been an Apple product that has killed anything or put any major business under.

Most netbooks I have used can barely run a desktop OS, as is. Most people buy netbooks for internet browsing, listening to music and watching videos, not as notebook replacements. The iPad seems to do those three things far better than the average netbook.

+1
I have an TV, and you are right. It is a really great idea, but just missing on a few key things to make it truly outstanding.
It's almost an entertainment center replacement, but no HDMI, lack of support for different codecs, etc. No coax or cable-box replacement capability. Lack of content( isn't the hardware's fault, or the software for that matter, but still) And no optical drive.
I suppose if it had such things it would be a mini.

Its not even something that competes with Netbooks because it doesn't run a desktop OS. Also people that buy netbooks are spending under 300.00 they would have to spend double to get even the lowest end iPad. So I dont see this killing netbooks.

In fact there has never been an Apple product that has killed anything or put any major business under.

Yep I agree. People on this board need to take off their RDF glassess... Price always wins in consumer space. People have to realize that $500 is a lot of money for some people. Not everyone can afford such devices.

Windows Media Center, Zune, Windows 7, and the new Windows Mobile Phone Series 7 (or whatever they called it) all have beautiful looking interfaces. The Courier would fall into that category too, so everyone that sees screenshots gets excited. In my experience, Microsoft does fall short in the usability aspects though. I don't know why Apple gets called out for form over function when Microsoft doesn't, because that is all I see in their UIs.

I planning making a blue-ray and game playing HTPC, but thus far the computer hasn't made it out of my room (I don't like Windows media center either), and I am wanting to go back to my original idea which was a mini.

Windows 7 Media Center is awesome if you couple it with a great front end like Media Browser. I've currently got a W7 PC hooked up to my 50" plasma. It does everything. PC Games, iTunes Music, TV shows, Hulu, Websites, Blu-Rays, Arcade Emulator...the works.

Wireless keyboard (DiNovo). Xbox 360 wireless controller for games (I know, mouse+keyboard is better, but I grew up on consoles and I don't have time to learn a new way to play. Plus keyboard doesn't work too well on PacMan.

The best part is that I built my PC for <$400 + some old parts lying around. How much is an Apple TV again?

What is this fixation with killing markets? The iPad isn't designed to "kill" anything. It's designed to create something. I'm sure Apple will be perfectly happy if people continue to buy $300 netbooks for whatever reason they buy $300 netbooks. Nobody really makes much money selling them anyway, which is why Apple isn't going there. Apple is interested in developing a new market in which they can actually make money. What a concept.

+1
I have an TV, and you are right. It is a really great idea, but just missing on a few key things to make it truly outstanding.
It's almost an entertainment center replacement, but no HDMI, lack of support for different codecs, etc. No coax or cable-box replacement capability. Lack of content( isn't the hardware's fault, or the software for that matter, but still) And no optical drive.
I suppose if it had such things it would be a mini.

Apple limited the functionality of the AppleTV from day one for some unknown reason... Perhaps we will know in the future...

But a device that didn't allow a user do to simple things like creating a movie playlist instead of just listing all of your movies in one large list is pathetic...

Yep I agree. People on this board need to take off their RDF glassess... Price always wins in consumer space. People have to realize that $500 is a lot of money for some people. Not everyone can afford such devices.

Not everybody can afford coffee at Starbucks either, but that doesn't seem to hurt their sales. What was your point again?

What is this fixation with killing markets? The iPad isn't designed to "kill" anything. It's designed to create something. I'm sure Apple will be perfectly happy if people continue to buy $300 netbooks for whatever reason they buy $300 netbooks. Nobody really makes much money selling them anyway, which is why Apple isn't going there. Apple is interested in developing a new market in which they can actually make money. What a concept.

The whole promise of the platform is multi-faceted, but not to take over notebooks, or netbooks for that matter.
It is do do books better, magazines, to do print media better. The Kindle shows it will work, the iPad is supposed to be an improvement on that. Also, it does wifi for simple web surfing, etc. Some iPhone apps, games, etc will be better on it due to the larger format. This one device can replace students backpacks, books, and notebooks. Dock with KB at school, one at home. No more expensive books to buy or lug around.

boo-hoo. the guy already apologized. leave him alone. it's not like he killed any trees doing it. some of you (who post about length or spelling or grammar or punctuation) really need to lighten up. would it hurt you to scroll through his reposted article to get to his comment?

on the topic--great start. where are all the naysayers? regardless of what you may think of the ipad, it's going to be hugely successful. if not in it's first iteration, most definitely in the future.

You should do some research on how Starbucks has been doing financially...

Starbucks' problem has been too much growth (i.e., investments in new stores, new employees etc and cannibalization of existing stores; expansion into non-core activities like CDs and fat/greasy muffins, etc) relative to growth in demand, leading to a squeeze their cash flows. A classic affliction of many a retail brand (e.g., Boston Market, Burger King, Sears....)

I think his point was simply that higher price does not necessarily deter sales, given all else that the product or service is offering. I.e., it's price of a cup of coffee relative to value offered that matters.

My point being is that the iPod and iPhone has always been priced in line with the competition. Their superior user experience along with a competitive price point lead to market domination...

Last I checked Zunes or Andriod phones weren't considerable cheaper (if at all) than Apple's products... Apple's iPad, while potentially a great product, isn't price competitively at this point with Netbooks. If that changes in the future is unknown at this point.

It's besides the point because it isn't in any way, shape or form a response to the point. Not only is the proof lacking for the argument that "price always wins," the evidence doesn't even bloody well exist. The concept that people never choose to spend more for something is patently absurd. It defies the fundamental reality that we all know exists.

My point being is that the iPod and iPhone has always been priced in line with the competition. Their superior user experience along with a competitive price point lead to market domination...

Last I checked Zunes or Andriod phones weren't considerable cheaper (if at all) than Apple's products... Apple's iPad, while potentially a great product, isn't price competitively at this point with Netbooks. If that changes in the future is unknown at this point.

Whether they are priced "in line" or not is debatable, but you're now making a substantially different argument. People do indeed buy user experience, and other less than tangible qualities. Clearly. This is what Apple has always sold. But again, I think you are making the mistake of assuming that Apple is going after the netbook market. If they wanted to do that, they'd be selling netbooks. Instead they are selling the iPad, which doesn't seem even remotely like a netbook to me. In fact its dissimilarity to netbooks is what a lot of geekdom seems to hate about it.

Windows 7 Media Center is awesome if you couple it with a great front end like Media Browser. I've currently got a W7 PC hooked up to my 50" plasma. It does everything. PC Games, iTunes Music, TV shows, Hulu, Websites, Blu-Rays, Arcade Emulator...the works.

Wireless keyboard (DiNovo). Xbox 360 wireless controller for games (I know, mouse+keyboard is better, but I grew up on consoles and I don't have time to learn a new way to play. Plus keyboard doesn't work too well on PacMan.

The best part is that I built my PC for <$400 + some old parts lying around. How much is an Apple TV again?

What point don't I get that iPhone early adopters went nuts when Apple dropped the price by 200.00 and then got rid of the 4GB model? Because thats exactly what happened, if that wasn't fact SJ wouldn't have offered a 100.00 Apple Store credit to try and calm things down.

It appears you just dont get it.

I wasn't talking about that, I was talking about the fact that they're not just going to randomly drop the iPad's price like you keep suggesting. They'd have no reason to.

Whether they are priced "in line" or not is debatable, but you're now making a substantially different argument. People do indeed buy user experience, and other less than tangible qualities. Clearly. This is what Apple has always sold. But again, I think you are making the mistake of assuming that Apple is going after the netbook market. If they wanted to do that, they'd be selling netbooks. Instead they are selling the iPad, which doesn't seem even remotely like a netbook to me. In fact its dissimilarity to netbooks is what a lot of geekdom seems to hate about it.

That is why Windows still dominates the market after all of these years with their great user experience... Price is everything in consumer space. User experience is a value add.

Wow, so they're charging you now for something that won't ship for almost 3 weeks? I don't think the charge will stay as pending until the iPad ships.

When I pre-ordered my two iPhone 3GSs last year Apple held the total amount for one day then released it. They didn't charge me again until they shipped them. It depends on your bank. My bank usually show a hold few hours later. The actual charge usually take 48 hours to show up.

@anantksundaram et al:
Does anybody know the finance Formula for Projected Share Price Increase for a given amount of Unit sales?
-I'm trying to make the beginnings of a guess at how much x sales of the iPad might add to AAPL's share price at the Minimum.

That is why Windows still dominates the market after all of these years with their great user experience... Price is everything in consumer space. User experience is a value add.

Again, that's not even close to a response to anything I said. You seem to be trying to dodge your claim that "price always wins," when you must know full well that it does not. I doubt very much that you conduct your life that way, any more than any other human being does. User experience can't be detached, like it's an option of some sort. Intangibles are a part of the product. Every product you could think of, and we could name them all day long.

@anantksundaram et al:
Does anybody know the finance Formula for Projected Share Price Increase for a given amount of Unit sales?
-I'm trying to make the beginnings of a guess at how much x sales of the iPad might add to AAPL's share price at the Minimum.